Today’s globalized world has presented the supply chain industry with opportunities galore. But along with the huge potential that companies have to make a mark through creating benchmark supply chain strategies, the compactness of the world has also brought with it a number of challenges.
Major challenges faced by supply chain professionals today
As the world becomes more and more connected, the challenges will only increase multi-fold and this is what we are witnessing today. With economies across the world becoming increasingly globalized, companies are expanding their presence in order to tap into untouched markets. This is a great thing for companies as of now they can look at creating a name for themselves in newer markets. A huge opportunity, but a challenging one nonetheless. With expansion of operations, companies face a number of hurdles in logistics, manufacturing, selecting, and managing suppliers, and so on. On top of that, different regions have different government rules and regulations, making it difficult to operate with one set standards.
Companies cannot definitely follow a cookie-cutter, one single process when it comes to operating in today’s world. Different markets call for different strategies. There are incidences of unsuccessful supplier relationships, inconsistent suppliers, delayed shipments, stalled manufacturing, inefficient plants and much more.
There are three major challenges that supply chain professionals need to brainstorm about and come up with strategic solutions. When we say supply chain expansion, the first challenge that comes to mind is maintaining visibility of operations across the entire supply chain and logistics network. The next task that supply chain managers have at hand is managing the demand volatility and of course the cost fluctuations in the network.
If not managed properly, all these challenges can add up to significant supply chain costs. Your ability to conduct supply chain operations and thereon delighting your customers may be hampered. This can negatively impact your established brand name and induce losses. Thus, it is absolutely integral that in today’s connected world, you align your supply chain in a way that allows you maximum visibility and empowers you to get a peek into future trends. Those companies that are best able to tailor their supply chain operations to suit the conditions in the various regions that they operate and are aptly able to leverage advanced technologies in their activities will be the ones braced for the long road ahead.
Analytics in supply chain and logistics
In order to overcome the challenges that the supply chain industry is reeling under, companies are depending on high powered analytics to come to their rescue and rightly so. Supply chain analytics has emerged as the power driving businesses towards right decisions through focus on data. Thanks to analytics, business can get invaluable insights and significantly improve their decision-making and action-taking capabilities. Businesses are earmarking huge chunks of budgets on getting their hands onto the latest analytical solution to provide their business with that much-needed winning edge.
Building successful business entities
Visibility is important and with the right supply chain services and solutions in place, company can ensure that their supply chain managers have a bird’s eye view of all the happenings in the supply chain at a global level. With the help of real-time dashboards, supply chain professionals can easily get deep insights into what the status is of various activities in the entire network, right from Shanghai to San Francisco. This means, they can get immediate information on stalled shipments or late customer deliveries and so much more, allowing them to take quick action to improve performance.
With increase in product variance, demand volatility has increased manifold, making demand and inventory management a challenge in today’s world. Most of the industries such as retail, automotive, FMCG require frequent and even daily forecasts of demand to ensure they are able to stock the right amount of inventory. The FMCG company especially in the food and beverage category for example may require daily predictions of expected demand so that they are able to keep the right amount of inventory. Stocking too much means chances of inventory being spoilt, thus incurring cost and stocking too less would mean opportunity loss and even a hit on the brand. Thus, advanced analytics can be implemented to inventory management to monitor demand and stock the most optimum amount of inventory and replenish accordingly.
Analytics is thus an important piece of the puzzle when it comes to building successful supply chain network and thereby a successful business. Analytics is equivalent to innovation and investment in this sector is only set to increase as companies realize the value of data-driven decision making.